Leveraging these enablers lead to so-called Smart Products and Smart Services which heavily base on collected data (from Big Data to Smart Data), hence create an ideal Product-Market-Fit and at the same time accelerate innovation cycles and the competitive pressure.

A Smart Product can stand for very different tangible assets and therefore includes complex industrial machines and plants as well as privately used devices e.g. in a smart home and even your smartphone. Within the industrial sector, smart products (technical systems) are usually cyber-physical systems (CPS) that allow the coupling and coordination of computing power and mechanical elements. These products or systems typically “talk” to each other (machine-to-machine; M2M) and exchange relevant operational data, which they typically collect using different sets of sensors, and they can event (re)act on that data using actuators.

Smart Services are individually configured packages of (smart) products and services over the Internet. The focus is on private and commercial users. With the help of digital data from all areas, smart services are tailored to their preferences and situation-specific “as a service” to generate value-add. Digital platforms and marketplaces play a central role: Here, products and services are displayed virtually, combined, refined with additional digital services and offered as smart services.

A smart product typically ends up in a smart service, and both nowadays are mainly created / invented by startups. Not only since founding a startup has never been so easy – just take a look at all the crowdfunding possibilities – but also due to the importance of diversity and culture within a company: corporates typically do struggle with employee engagement and with their amount of hierarchy levels, which makes them very slow in becoming digital leaders:

Hence today, corporates do rely on startups, driving external innovation or by hiring from or M&Aing them, but also using accelerators, incubators and innovation hubs and labs to not doom in the digital transformation age.